KL Kepong’s earnings slip 2.4% to RM209.6m as CPO prices drop

KUALA LUMPUR: Kuala Lumpur Kepong Bhd's (KLK)
earnings slipped 2.4% to RM209.6mil in the second quarter ended March
31, 2013 from RM214.9mil a year ago due to the challenging phase in its
plantation sector.
It said on Wednesday its revenue fell 14.8%
to RM2.235bil from RM2.624bil a year ago. Earnings per share were 19.7
sen compared with 20.20 sen. It declared an interim dividend of 15 sen
a share.
KLK said its plantation suffered a 36.6% profit drop to
RM191.6mil as the decline in the commodity selling prices reduced the
quarter's profit despite higher fresh fruit bunches production.
Its
manufacturing sector however improved 87.8% to RM81.2mil and the impact
of the changes in fair value on outstanding derivative contracts
amounted to a gain of RM14.6mil vs RM3.2mil a year ago.
Its oleochemical division, which has improved more than two fold also contributed RM86.6mil to the group.
It
said the pressure on palm product prices has been further compounded by
the recent high levels of stocks in both Indonesia and Malaysia,
resulting in a substantial reduction to the current palm oil price
level of RM2,300 a tonne.
For the first half, its earnings fell
15.3% to RM470.57mil from RM555.89mil in the previous corresponding
period. Its revenue also declined, down 27.8% to RM4.556bil from
RM5.547bil a year ago.
"In view of the prevailing palm products
prices, the group's plantations profit will be much lower than that of
the previous financial year," it said.
KLK said it foresees lower profit for the current financial year as compared to that of the previous financial year.